The War's Public Finances

[Yesterday, at the ongoing the Asia-Europe Peoples Forum in Helsinki (which precedes the Asia Europe Meeting here next week-end) I heard a representative of Jubilee South complaining about the lack of traffic on the WPF list.Below, I present some preliminary remarks which I jotted down just before and during our seminar on WORLD PUBLIC FINANCES and sent to the WPF-list. This blog entry is a slightly edited and amended version of my message . ]

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WORLD PUBLIC FINANCES are needed, firstly, because "around half of all world trade appears to pass through tax haven jurisdictions" (1).

The Tax Justice Nework, wisely, uses the phrase "appears to". The correct figure could actually be higher than "half of" all world trade. Tax havens are, by definition, beyond public scrutiny. The figure thus obscures the the very fact that it is to shed light on. [Or is it rather the fact that obscures the figure?]

One is tempted to call the tax-havens the non-public half of the world's finances.

However, the situation is more complicated, to say the least. Even if precise information is not easily available to the public, this surely does not mean that it is not available at all. All that money is certainly being carefully tracked and documented.

Moreover - and this is a crucial point - it has never been as easy to follow the capital flows as it is today, because of the computer power which is readily at hand.

When elaborating our concept of World Public Finances, we should therefore pay due attention to the financial technology. Financial technology equals the digitalised systems of the financial services industry: banks, investment managment companies, and central institutions like SWIFT and Clearstream.

The French investigating journalist Denis Robert, building on testimony from experts on banking and financial transactions, e.g. Ernest Backes and Regis Hempel, has published a series of revealing books on the use and abuse of financial technology.(2) His findings about the clearing systems of the business banks are at the center of French interior politics. To be sure, they also concern the relations between Europe and Asia. Denis Robert brings essential background to, for instance, the scandal with the fregates that France sold to Taiwan at the beginning of the 1990ies, and the huge "commissions" and "retrocommissions" which French politicians and Chinese middlemen gained from that affair.

Will the ASEM meeting help dismantling intimate relations between the arms trade, the tax havens and the money laundering? Will it tackle these issues?

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This brings me to a second point about the world's public finances.

"U.S Military spending is now equal to, if not greater than the military spending of the rest of the countries of the world combined".

Considering that the US military spending is that big, could we not expect the ASEM -- the Asian and European leaders -- to say something about it together?

"perhaps a good goal for the first phase of this project would be to cut [the military] spending [of the US] by 75 percent".

Griffin here addresses the American churches. He wants the churches to take stand on the issue of the gross militarisation. The ASEM should endorse this proposal. How long will the European and Asian leaders be prepared to be dominated by the American superpower?

The military spending of the US is a real disgrace from the point of view of the world's public finances. It is actually "[...] far greater than the budget for the Defense department" ( the DoD spends 19% of the US federal budget). "The expenditures for nuclear weapons, for example, are in the budget of the Energy Department", Griffin notes. Economist Jurgen Brauer has estimated that "Defense is not one- fifth of federal spending, but two thirds of it"(3).

If that last figure is true, then we should perhaps start speaking about the "War's Public Finances" . We need to realise that World Public Finances is nowadays very much about War's Public Finances.

A movement for global democracy cannot be led by the government of a certain state; nor can it be brought about by a certain bloc, or alliance, of states. The Empire of the United States has become one of the democratic movement's adversaries, which it has to defeat. But the movement for global democracy must, of course, include the American people itself. And I believe that the global democracy we want has to build on the best traditions of the American people, in particular, on the federalist ideas of the so called founding fathers of the USA.

Yesterday, at the WPF seminar, some people expressed doubts (or so I felt) as
to whether the military spending of the USA really should be an issue for the
ASEM meeting. However, this is how the ASEM meeting describes itself on its
webpage
http://www.asem6.fi/ :

"The Summit will focus on ways to respond to the challenges of globalisation.
The issues on the agenda include global security threats, energy security,
climate change, WTO negotiations, ways to strengthen cultural dialogue,
competitiveness and the structural changes in global economy."

Is not the grotesque military-related spending of the USA posing one of the
worst "global security threats" that we know of?